A manager needs to develop an early warning system that includes: The manager would need to include a macroeconomic warning signal, a customer sales forecest, critical costs, and end-users information. These must all be items that are used consistently.
Managing through the Business Cycle
| Steps | Description |
|---|---|
| macroeconomic warning signals | The early warning system should include indicators for the overall economy and the relevant industry. |
| end-user information | For example, a bottle manufacturer should watch sales of beer and soft drinks. A fabric manufacturer should watch apparel sales. |
| consumer sales forecast | A company should also monitor its own clients. A manager should break out sales reports by product groups, regions, and customers to trace major surprises in sales. |
| critical cost | The companies that need pay the closest attention to costs are usually manufacturers, utilities, and contractors with with significant exposure to one or two raw materials with typically volatile prices. |
Macroeconomic Warnings are used to be able to focus on specific parts of a company to focus on that area of economy. It is used in a way to it allows us to see a trend on what is in demand and how quickly or slowly a consumer is gravitating towards spending their money on a product or service.
End User Information is what is used to be able to distinguish a person that had created a hardware or product that has been produced and put out by either the developers, or different servicers that ship out the goods or services.
Consumer sales and forecasts are huge when creating an outlook on how your company will do in sales with-in the month, quarter, or years. By being able to forecast based off of consumer sales you are going to be able to tell what the best time to sell certain products at and have it be at a very strong level of accuracy.
Critical cost is in relation to what are the customer’s needs in relation to how it revolves around the cost of your product, but this does not only revolve around the cost of the product. It also can be based on its shipping costs, and even if there are labor charges.
Summing up is straight forward and it is just by being able to plan ahead so you are prepared ahead of time.
Explain each of the following terms in your own words. The author explains the terms in the textbook. If necessary, you may also Google the term on the Web. Good resources include:
Explain the terms in your own words briefly.
A seasonal adjustment is a technique in statistics which allows us to be able to attempt to measure as well as remove influences of a predictable pattern during different seasons. It also is able to show up the differences in employment and unemployment rates between different months at a time.
Describe the characteristics of the following events briefly.